When To Deduct
You can deduct your contributions only in
the year you actually make them in cash or
other property (or in a later carryover year,
as explained later under Carryovers). This
applies whether you use the cash or an
accrual method of accounting.
Time of making contribution. Usually, you
make a contribution at the time of its un-conditional
delivery.Checks. A check that you mail to a
charity is considered delivered on the date
you mail it.Credit card. Contributions charged on
your bank credit card are deductible in the
year you make the charge.Pay-by-phone account. If you use a
pay-by-phone account, the date you make
a contribution is the date the financial institution
pays the amount. This date should
be shown on the statement the financial institution
sends to you.Stock certificate. The gift to a charity
of a properly endorsed stock certificate is
completed on the date of mailing or other
delivery to the charity or to the charity's
agent. However, if you give a stock certificate
to your agent or to the issuing corporation
for transfer to the name of the charity,
your gift is not completed until the date the
stock is transferred on the books of the corporation.Promissory note. If you issue and deliver
a promissory note to a charitable organization
as a contribution, it is not a contribution
until you make the note payments.Option. If you grant an option to buy real
property at a bargain price to a charitable
organization, you cannot take a deduction
until the organization exercises the option.Borrowed funds. If you make a contribution
with borrowed funds, you can deduct
the contribution in the year you make it, regardless
of when you repay the loan.

Limit on Deductions
If your total contributions for the year are
20% or less of your adjusted gross income,
you do not need to read this section. The
limits discussed here do not apply to you.
The amount of your deduction may be
limited to either 20%, 30%, or 50% of your
adjusted gross income, depending on the
type of property you give and the type of
organization you give it to. These limits are
described below.
If your contributions are more than any
of the limits that apply, see How To Figure
Your Deduction When Limits Apply, in
Publication 526.

50% Limit
This limit applies to the total of all charitable
contributions you make during the year.
This means that your deduction for charitable
contributions cannot be more than 50%
of your adjusted gross income for the year.
The 50% limit is the only limit that applies
to gifts to organizations listed below
under 50% limit organizations. But there is
one exception. The 30% limit also applies
to such gifts if they are gifts of capital gain
property for which you figure your deduction
using fair market value without reduction for
appreciation. (See 30% Limit, later.)
50% limit organizations. You can ask any
organization whether it is a 50% limit organization
and most will be able to tell you.
The following is a partial list of the types of
organizations that are 50% limit organizations:
1) Churches, and conventions or associations
of churches,
2) Educational organizations with a regular
faculty and curriculum that normally
have a regularly enrolled student body
attending classes on site,
3) Hospitals and certain medical research
organizations associated with these
hospitals,
4) Publicly supported charities,
5) Private operating foundations,
6) Private nonoperating foundations that
make qualifying distributions of 100%
of contributions within 2 1 /2 months following
the year they receive the contribution,
and
7) Certain private foundations whose
contributions are pooled in a common
fund, the income and principal of which
are paid to public charities.

30% Limit
This limit applies to the following contributions.
* Gifts of capital gain property to 50%
limit organizations. (For other gifts of
capital gain property, see 20% Limit,
later.) However, the 30% limit does not
apply when you choose to reduce the
fair market value of the property by the
amount that would have been long-term
capital gain if you had sold the property.
Instead, only the 50% limit applies. For
more information, see the rules for
electing the 50% limit for capital gain
property under How To Figure Your
Deduction When Limits Apply in Publication
526.
* Gifts (other than gifts of capital gain
property — see 20% Limit, later) for the
use of any organization.
* Gifts (other than capital gain property
— see 20% Limit, later) to all qualified
organizations other than 50% limit organizations.
This includes gifts to veterans'
organizations, fraternal societies,
nonprofit cemeteries, and certain private
nonoperating foundations.

20% Limit
This limit applies to all gifts of capital gain
property to or for the use of qualified organizations
other than gifts of capital gain
property to 50% limit organizations.

Carryovers
You can carry over your contributions that
you are not able to deduct in the current
year because they exceed your adjusted
gross income limits. You can deduct the
excess in each of the next 5 years until it is
used up, but not beyond that time. For more
information, see Carryovers in Publication
526.

Records To Keep
You must keep records to prove the amount
of the cash and noncash contributions you
make during the year. The kind of records
you must keep depends on the amount of
your contributions and whether they are
cash or noncash contributions.Note. An organization generally must
give you a written statement if it receives a
payment from you that is more than $75 and
is partly a contribution and partly for goods
or services. (See Contributions From Which
You Benefit under Contributions You Can
Deduct, earlier.) Keep the statement for
your records. It may satisfy all or part of the
recordkeeping requirements explained in
the following discussions.

Cash Contributions
Cash contributions include those paid by
cash, check, credit card, or payroll deduction.
They also include your out-of-pocket
expenses when donating your services.
For a contribution made in cash, the
records you must keep depend on whether
the contribution is:
1) Less than $250, or
2) $250 or more.Amount of contribution. In figuring
whether your contribution is $250 or more,
do not combine separate contributions. For
example, if you gave your church $25 each
week, your weekly payments do not have
to be combined. Each payment is a separate
contribution.
If contributions are made by payroll deduction,
the deduction from each paycheck
is treated as a separate contribution.
If you made a payment that is partly for
goods and services, as described earlier
under Contributions From Which You Benefit,
your contribution is the amount of the
payment that is more than the value of the
goods and services.

Contributions of Less Than $250
For each cash contribution that is less than
$250, you must keep one of the following
items.
1) A canceled check, or a legible and
readable account statement that
shows:
a) If payment was by check – the
check number, amount, date
posted, and to whom paid.
b) If payment was by electronic
funds transfer – the amount, date
posted, and to whom paid.
c) If payment was charged to a credit
card – the amount, transaction
date, and to whom paid.
2) A receipt (or a letter or other written
communication) from the charitable
organization showing the name of the
organization, the date of the contribution,
and the amount of the contribution.
3) Other reliable written records that include
the information described in (2).
Records may be considered reliable if
they were made at or near the time of
the contribution, were regularly kept by
you, or if, in the case of small donations,
you have emblems, buttons,
or other tokens that are regularly given
to persons making small cash contributions.Car expenses. If you claim expenses directly
related to use of your car in giving
services to a qualified organization, you
must keep reliable written records of your
expenses. Whether your records are considered
reliable depends on all the facts and
circumstances. Generally, they may be
considered reliable if you made them regularly
and at or near the time you had the
expenses.
Your records must show the name of the
organization you were serving and the date
each time you used your car for a charitable
purpose. If you use the standard mileage
rate of 14 cents a mile, your records must
show the miles you drove your car for the
charitable purpose. If you deduct your actual
expenses, your records must show the
costs of operating the car that are directly
related to a charitable purpose.
See Car expenses, earlier under Out-of-Pocket Expenses in Giving Services, for
the expenses you can deduct.Contributions of $250 or More
You can claim a deduction for a contribution
of $250 or more only if you have an acknowledgment
of your contribution from the
qualified organization or certain payroll deduction
records.
If you made more than one contribution
of $250 or more, you can have either a
separate acknowledgment for each or one
acknowledgment that shows your total contributions.Acknowledgment. The acknowledgment
must meet these tests.
1) It must be written.
2) It must include:
a) The amount of cash you contributed,
b) Whether the qualified organization
gave you any goods or services
as a result of your contribution
(other than certain token items
and membership benefits), and
c) A description and good faith estimate
of the value of any goods
or services described in (b). If the
only benefit you received was an
intangible religious benefit (such
as admission to a religious ceremony)
that generally is not sold in
a commercial transaction outside
the donative context, the acknowledgment
must say so and
does not need to describe or estimate
the value of the benefit.
3) You must get it on or before the earlier
of:
a) The date you file your return for
the year you make the contribution,
or
b) The due date, including extensions,
for filing the return.Payroll deductions. If you make a contribution
by payroll deduction, you do not need
an acknowledgment from the qualified organization.
But if your employer deducted
$250 or more from a single paycheck, you
must keep:
1) A pay stub, Form W–2, or other document
furnished by your employer that
proves the amount withheld, and
2) A pledge card or other document from
the qualified organization that states
the organization does not provide
goods or services in return for any
contribution made to it by payroll deduction.Out-of-pocket expenses. If you render
services to a qualified organization and
have unreimbursed out-of-pocket expenses
related to those services, you can satisfy the
written acknowledgment requirement just
discussed if:
1) You have adequate records to prove
the amount of the expenses, and
2) By the required date, you get an acknowledgment
from the qualified organization
that contains:
a) A description of the services you
provided,
b) A statement of whether or not the
organization provided you any
goods or services to reimburse
you for the expenses you incurred,
c) A description and a good faith
estimate of the value of any goods
or services (other than intangible
religious benefits) provided to reimburse
you, and
d) A statement of any intangible religious
benefits provided to you.

Non cash Contributions
For a contribution not made in cash, the
records you must keep depend on whether
your deduction for the contribution is:
1) Less than $250,
2) At least $250 but not more than $500,
3) Over $500 but not more than $5,000,
or
4) Over $5,000.Amount of contribution. In figuring
whether your contribution is $250 or more,
do not combine separate contributions. If
you received goods or services in return,
as described earlier in Contributions From
Which You Benefit, reduce your contribution
by the value of those goods or services. If
you figure your deduction by reducing the
fair market value of the donated property
by its appreciation, as described earlier in
Giving Property That Has Increased in
Value, your contribution is the reduced
amount.

Deductions of Less Than $250
If you make any noncash contribution, you
must get and keep a receipt from the charitable
organization showing:
1) The name of the charitable organization,
2) The date and location of the charitable
contribution, and
3) A reasonably detailed description of
the property.

TIPA letter or other written communication
from the charitable organization
acknowledging receipt of the
contribution and containing the information
in (1), (2), and (3) will serve as a receipt.
You are not required to have a receipt
where it is impractical to get one (for example,
if you leave property at a charity's
unattended drop site).Additional records. You must also keep
reliable written records for each item of donated
property. Your written records must
include the following information.
1) The name and address of the organization
to which you contributed.
2) The date and location of the contribution.
3) A description of the property in detail
reasonable under the circumstances.
For a security, keep the name of the
issuer, the type of security, and
whether it is regularly traded on a stock
exchange or in an over-the-counter
market.
4) The fair market value of the property
at the time of the contribution, and how
you figured the fair market value. If it
was determined by appraisal, keep a
signed copy of the appraisal.
5) The cost or other basis of the property
if you must reduce its fair market value
by appreciation. Your records should
also include the amount of the reduction
and how you figured it. If you
choose the 50% limit instead of the
special 30% limit on certain capital gain
property, you must keep a record
showing the years for which you made
the choice, contributions for the current
year to which the choice applies, and
carryovers from preceding years to
which the choice applies. See How To
Figure Your Deduction When Limits
Page 164 Chapter 26 Contributions
Apply in Publication 526 for information
on how to make the capital gain property
election.
6) The amount you claim as a deduction
for the tax year as a result of the contribution,
if you contribute less than
your entire interest in the property
during the tax year. Your records must
include the amount you claimed as a
deduction in any earlier years for contributions
of other interests in this
property. They must also include the
name and address of each organization
to which you contributed the other
interests, the place where any such
tangible property is located or kept,
and the name of any person in possession
of the property, other than the
organization to which you contributed.
7) The terms of any conditions attached
to the gift of property.

Deductions of At Least $250
But Not More Than $500
If you claim a deduction of at least $250 but
not more than $500 for a noncash charitable
contribution, you must get and keep an acknowledgment
of your contribution from the
qualified organization. If you made more
than one contribution of $250 or more, you
can have either a separate acknowledgment
for each or one acknowledgment that shows
your total contribution.
The acknowledgment must contain the
information in items (1) through (3) listed
under Deductions of Less Than $250, earlier,
and your written records must include
the information listed in that discussion under
Additional records.
The acknowledgment must also meet
these tests.
1) It must be written.
2) It must include:
a) A description (but not necessarily
the value) of any property you
contributed,
b) Whether the qualified organization
gave you any goods or services
as a result of your contribution
(other than certain token items
and membership benefits), and
c) A description and good faith estimate
of the value of any goods
or services described in (b). If the
only benefit you received was an
intangible religious benefit (such
as admission to a religious ceremony)
that generally is not sold in
a commercial transaction outside
the donative context, the acknowledgment
must say so and
does not need to describe or estimate
the value of the benefit.
3) You must get the acknowledgment on
or before the earlier of:
a) The date you file your return for
the year you make the contribution,
or
b) The due date, including extensions,
for filing the return.

Deductions Over $500
You are required to give additional information
if you claim a deduction over $500
for noncash charitable contributions. See
Records To Keep in Publication 526 for
more information.

Qualified Conservation
Contribution
If the gift was a “qualified conservation
contribution,” your records must also include
the fair market value of the underlying
property before and after the gift and the
conservation purpose furthered by the gift.
See Qualified conservation contribution in
Publication 561 for more information.

How To Report
Enter your cash contributions (including
out-of-pocket expenses) on line 15, Schedule
A (Form 1040).
Enter your noncash contributions on line
16 of Schedule A (Form 1040).
If your total deduction for all noncash
contributions for the year is over $500, you
must also file Form 8283. See How To
Report in Publication 526 for more information.